April 27, 2023 4 min

A Strategic Approach to Investing in Real Estate in India


As the real estate market in India continues to evolve, the demand for residential properties is skyrocketing, with a niche segment of buyers hoping to seek an experience that transcends the ordinary. Today’s consumers are looking for more than just four walls and a roof; their penchant for all things larger-than-life underlines such crucial decisions. 

It is in response to this trend that developers have introduced a new set of ready-to-move-in luxury condos- swanky abodes offering architectural finesse and a complete lifestyle overhaul that is steeped in dashes of comfort and convenience. 

But in a perennially fluctuating market like this, the million-dollar question on every discerning buyer’s mind is whether now is the opportune moment to invest in their dream house. 

Delve deeper into the world of real estate with our guide and discover if now is the ideal time to invest in a home or perhaps even a secondary residence.

Factors to consider before you make the leap

Market Trends

Navigating the fluctuating tides of this market can sure be daunting, but understanding its ebbs and flows is crucial as well. Buyers should analyze market trends in their target areas to determine whether costs are likely to peak or fall in the near future. For example, if there is an overbuilding of housing units in a specific area, it may lead to a decrease in property value, making it an unwise investment for buyers seeking long-term profits.

Interest rates

These rates play a crucial role in determining the demand for such properties and the affordability of mortgage payments for the same. Despite the RBI’s decision to increase interest rates by a total of 250 basis points since May 2022, indications point to an upswing in homeownership in the coming years,  driven in part by a strong preference for owning rather than renting a home.

Tax Benefits

When it comes to real estate investment in India, tax benefits can be a potential game changer. By tactfully leveraging deductions on mortgage interest payments, property taxes, and depreciation, buyers can turn a profitable deal into a sweet victory.

Navigating The Homebuying Process: A Step by Step guide

Understanding why you want to buy a house

Before you dive into the complex process of buying a house, it’s important to have a clear understanding of your reasoning behind it. Are you looking for a long-term investment? Do you need more space to accommodate growing family needs? Or is it an upgrade in lifestyle that you’re seeking? Whatever your underlying goals may be, taking the time to reflect upon them can help you cement your decision and avoid potential regrets down the line. 

Check your credit score

Your credit score is a crucial factor in determining your ability to secure financing and the interest rates that you’ll be offered.

In addition to securing financing, a good credit score can also help you qualify for better terms and lower interest rates, ultimately saving you money in the long run.

Manage your down payments

The savvy buyer knows that an important element to obtaining a second home is carefully considering the down payment. You can consider raising your initial down payment to an amount between 30-40%;  this simple step can reduce the housing loan that you take out and consequently minimize the thousands of rupees you spend in interest fees over time. Moreover, having a greater share of the loan amount already paid off upfront is sure to provide a stress-free cushion for the future.

Assess Your Mortgage Affordability Before House Hunting

Maximizing your home buying power starts with assessing how much you can realistically afford to spend on a mortgage. Evaluate your financial situation, including income, expenses, and debt payments, to estimate a monthly payment that fits comfortably within your budget. And it is also important to keep in mind that the amount you’re approved for by a lender may not necessarily align with what you can afford, so be sure to do your own calculations and set a realistic budget before you make the big decision. 

Don’t Skip The Home Inspection

Don’t let the buzz of buying a new second home blind you to the probable issues that could be lurking just beneath the surface. A detailed home inspection can help you get an overall picture of the house’s structural and mechanical backdrops, allowing you to make informed decisions during the closing process. Depending on where you live and the specifics of your contract, you’ll typically need to complete an inspection within 10 to 15 days of signing the purchase agreement.

Consider your long-term financial goals

As your search for the dream home begins, it’s important to keep your long-term financial goals in mind. Consider whether your eyeing fits into the bigger picture of your life plans, be it familial or personal. Are you willing to make the necessary sacrifices in your current lifestyle to afford a home? Will it support your future endeavors or turn into a roadblock? Research thoroughly and be sure to discuss the decision with family and experts in the industry before signing the dotted line.

Take The Plunge or Wait it Out?

Real estate, as an asset class and a great store of value, has stood the test of time, hardening and becoming more and more robust.

When you decide to buy a house, it’s crucial to approach it with a strategic mindset;  Careful consideration should be given to factors such as job security, current housing prices, affordability of loans, and the prospects for future price appreciation. 

Don’t be swayed by emotional impulses or follow trends too closely; trust in your gut, stay educated on the market, and in the end, you’ll be in a property you can proudly call your own.

And if you already own a home and are looking for a second one, fractional ownership might be a great option to consider. Check out YOURS, the premier provider of luxurious second homes that come with a diverse portfolio spread across a variety of scenic locales in India.

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